It’s been a difficult journey for the cryptocurrency market until 2022. By November the market had dropped by 70% from its previous peak at the end of November. Just when the market was looking down, the FTX crash turned things worse. The question is, can the cryptocurrency market rebound in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin, has seen many dips over the years. Each time, it has bounced back with a big increase.
For example, in 2013, Bitcoin reached a peak of $1,160, then fell for more than a year, reaching a low of $150. In 2017 it broke that record and reached a new record high of $19,600. Fast forward to 2018, and it was trading at $3,100. And in the year 2020 it struck through that resistance and hit a new highest of $68,000 in November 2021. Then, just like that we’ve witnessed another drop. However, the past has proven that after each dip there’s a bull-run.
Every Dip is Followed by a Long Bull Run
Similar to what we’ve witnessed previously, dips tend to be followed by a prolonged bull run that finally surpasses the resistance created by the previous high price. This pattern can be seen not only in Bitcoin but also in other cryptocurrency.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have come a long way in recent years. With more and more businesses and industries embracing the technology, its use and acceptance is increasing. From finance to gaming the use of crypto is increasing in a myriad of ways. The growing popularity of crypto could result in more people getting involved in the market which could boost prices.
The rise in interest of institutions in cryptocurrency
In recent times we’ve witnessed a rising curiosity from institutions investing in crypto. From banks to hedge funds and even large corporations are beginning to investigate the possibilities of crypto assets. The increased interest of institutions can bring stability to the crypto market and could lead to more expensive prices.
As the crypto market continues to mature and mature, governments across the globe are starting to create more favorable regulations for cryptocurrency. This could help attract more investors as well as increase the adoption rate of crypto.
More use cases for blockchain
The underlying technology behind many cryptocurrencies, blockchain, is a broad range of applications that go beyond the realm of financial transactions. From supply chain management to voting systems, more companies are starting to explore how they can benefit from blockchain technology. This could drive more investment and interest in cryptocurrency.
Technologies are constantly evolving.
Blockchain and cryptocurrency technology is at the very beginning of development. As advances continue to be made in areas such as scalability and security, the potential of crypto assets will continue to increase. This could lead to more use and increase in prices.
Global economic uncertainty is growing
With the ongoing economic uncertainty caused due to the COVID-19 pandemic, as well as other causes increasing numbers of investors are starting to look for safe haven assets such as gold and crypto. As the global economic situation remains uncertain and uncertain, this could lead to an increase in demand for crypto and increased prices.
Retail investors are able to earn interest
Institutional investors aren’t the only people who are interested in cryptocurrency. Retail investors, or even individual investors, are also starting to get involved in the market for crypto. As more and more everyday people are educated about crypto and how to invest in it this could result in an increase in demand and consequently higher prices.
Growing awareness and acceptance of cryptocurrency
As the crypto market is maturing increasing numbers of people are beginning to become aware about and appreciate the concept. As awareness and acceptance of crypto grows, it will lead to more people purchasing as well as holding the crypto that could increase prices.
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Financial decentralization (DeFi) is a rapidly growing area of the crypto market, which allows the provision of financial services built using blockchain technology. As DeFi continues to grow and more platforms and projects become available, this will lead to a rise in adoption and more expensive prices for crypto.
Developments in crypto payment methods
As the crypto market continues to grow, more and more companies are starting accepting crypto payments as a form of payment. This could result in increased usage of crypto in daily transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
These funds are owned by the state as investments, are now beginning to look at crypto as a potential asset class. As more funds dedicate a part or their entire portfolios to cryptocurrency, this could increase demand and increased prices.
Cryptocurrency is used for cross-border payments
One of the biggest benefits of cryptocurrency is its ability to make quick and inexpensive cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions, this can lead to a rise in demand and higher costs.
An increasing number of crypto ATM’s
The number of ATMs that accept crypto continue to grow it will be easier for people to buy and keep cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, which are digital assets that represent ownership in an asset such as stock or real estate is a fast-growing area of the crypto market. Since more and more security tokens will be issued and traded, it could result in a rise in demand and higher rates for the crypto.
A greater adoption rate by merchants
In the event that more businesses begin accepting crypto as a means of payment, this will make it easier for customers to utilize and store crypto, which can increase demand and price.
So, will crypto grow in 2023? The only way to know is time. With these things in mind, it’s likely that the crypto market will be able to see a rebound in 2023. For those committed to the long-term, being patient and disciplined is essential.